NEW YORK (Reuters) -- Health maintenance organizations (HMOs) are under fire as legislatures and patient advocacy groups across the country try to curb what they see as excesses in the system.
"All is not well in HMO land," says Dr. Thomas Brodheimer in an article in this week's issue of The New England Journal of Medicine. "The backlash movement brings together patients who complain of services denied and physicians who are suffering the loss of autonomy."
HMOs are corporate middlemen, placed between healthcare providers, such as doctors and hospitals, and the patients who need their services. They began in the 1980s in reaction to spiraling healthcare costs. The goal of the HMO: to manage patient services in more cost-effective ways. Many HMOs are for-profit organizations, where costs saved on patient care result in higher profit for the HMO.
"HMOs are credited with slowing down medical inflation for the time being," Brodheimer admits. "And, they provide enrollees with broader benefit packages than can be obtained through traditional insurance." He says that the majority of healthy HMO participants -- who by nature require few services -- may have little to complain about.
But for the chronically ill, and for doctors who feel restricted in choosing the best care for their patients, the story can be very different. He says there is a long list of problems due to HMOs, and of legislative efforts aimed at solving them. These include:
-- "gag rules" forcing doctors to remain silent on possible -- expensive -- treatments which could help patients, have been uncovered at several HMOs. Eighteen states have passed laws banning such rules.
-- physician-HMO contract terminations, which HMOs can impose at will, can force doctors to think of the HMOs' bottom line ahead of patient needs. During the last year, nine states passed laws which protect doctors from termination "without just cause."
-- physician-access restrictions mean patients must chose a doctor from those already contracted to an HMO. Legislation seeking to widen access has been stalled by the managed-care industry and employers.
-- "gate-shutting" means that patients -- especially those with chronic illnesses like AIDS or ongoing cancer -- may be barred from seeing specialists who may have more expertise in a particular field. Limited legislation allowing free access to specialists (usually gynecologists) is available now in six states.
-- emergency room visits, which has strict criteria under HMO plans until recently, have become more available since 13 states passed laws allowing freer access.
-- postpartum 24-hour maternity hospital stays were legislatively lengthened to two days in over 28 states after popular resistance.
Brodheimer says these and other reactions are inevitable, especially in light of the enormous salaries HMO executives often command. "Chief executive officers of HMOs, who on average earn 62% more than CEOs of other corporations of similar size, are pilloried in the press as cold-hearted capitalists who make million dollar incomes by denying patients medical care," says Brodheimer.
The backlash, according to Brodheimer, is an attempt to reform the system -- or abandon HMOs altogether. Point-of-service HMO plans allow patients who can afford it to choose doctors outside their plan -- for an added fee. Provider-sponsored organizations, where hospitals and physicians groups seek to collaborate directly with patients, are gaining in popularity. And new 'medical savings accounts' may allow people to save tax-free dollars for future health needs.
Brodheimer doubts any of these movements will do more than rein in the HMO system. "HMO enrollment will continue to grow," he says, "...for many people HMOs are the only choice, or the most economical one."
Brodheimer sees change in the HMO system as inevitable. "Excess compensation of CEOs, high administrative costs... and denials of care will be moderated," he says. But all this will have a price. "It will not take long for the managed care industry -- soon to be a powerful oligopoly -- to raise premiums for employer and government payers," Brodheimer says.
Brodheimer hopes the backlash will force the managed care industry to return to the model of its earliest prototypes, where "over 90% of the premium dollar could be dedicated to healthcare." He says that in an ideal 'HMO land', "members of the medical profession could stop thinking about money and devote themselves single-mindedly to their patients."
SOURCE: The New England Journal of Medicine (1996;335(21):1601-1604)
